EX-10.19
Supply Agreement
SUPPLY AGREEMENT
THIS AGREEMENT, is made, entered into and effective as of the 27th day
of June, 1996, by and between MOUNTAINWOOD SPRING WATER Co., INC., a New Jersey
Corporation, with its administrative office at x0-00 Xxxx Xxxxxx, Xxxxxx, Xxx
Xxxxxx (the "Seller") and PURO WATER GROUP, INC., a Delaware Corporation, with
an office at 000 X. Xxxx Xxxxxx, Xxxx Xxxxxx, Xxx Xxxxxx ("Buyer").
WHEREAS, the Seller has under lease a certain premises located at
Mallard Pond Road in the Township of Xxxxxxxx, County of Xxxxxx and State of New
Jersey known as Mountainwood Spring (the "Spring"); and
WHEREAS, the Seller is willing to supply from the Spring and sell to
the Buyer, and the Buyer desires to purchase from the Seller natural spring
water from the Spring (the "Water"), upon the terms and conditions hereinafter
set forth; and
WHEREAS, the Seller shall deliver the Water to the Buyer in tanker
loads of at least 6,000 gallons (a "Tanker Load").
NOW, THEREFORE, in consideration of the foregoing, and of the
representations, warranties, covenants and agreements hereinafter contained, the
parties hereto do hereby mutually agree as follows:
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SECTION 1. Definitions
1.01 "Three Year Period" shall mean the thirty-six (36) calendar month
period commencing on July 1, 1995, and each successive thirty-six (36) month
period thereafter.
1.02 "Commencement Date" shall mean July 1, 1996.
SECTION 2. Purchase(s) and Sale.
2.01 Minimum Purchases -- The Seller shall sell and deliver to the
Buyer, and the Buyer shall purchase and accept from the Seller commencing July
1, 1996, and during the remainder of this Agreement, a minimum of forty (40)
Tanker Loads of Water (the "Minimum Order") delivered to its 000 Xxxxx Xxxx
Xxxxxx, Xxxx Xxxxxx, Xxx Xxxxxx facility each month.
2.02 Purchase Order -- Execution and delivery of this Agreement shall
constitute a purchase order from the Buyer to the Seller to purchase a minimum
of forty (40) Tanker Loads of Water per month. When and in the event this
Agreement is outstanding and the actual purchases by the Buyer are less than
forty (40) Tanker Loads of Water per month, then, in that event, as additional
consideration for this Agreement, the Seller shall invoice the Buyer for an
amount equal to the difference between the forty (40) Tanker Loads and the
actual number of Tanker Loads purchased by the Buyer that month as follows;
$350.00 per Tanker Load for the first twenty-five (25) Tanker Loads and $105.00
per Tanker Load for the next fifteen (15 Tanker Loads.
2.03 Priority Purchase Order -- The Buyer acknowledges that Seller
sells Water from the Spring to other consumers of the Water. If Seller is
presented by any contingency beyond its control from supplying the full
quantities of the Water ordered by the Buyer and its other customers, Seller
agrees that it shall not prorate the Minimum Order from the Buyer until it has
prorated its other customers to zero, if necessary, to meet the Minimum Order.
SECTION 3. Price; Adjustment; Payment Terms; Delivery and Risk of Loss
3.01 Price -- The price for each Tanker Load of Water shall be $350.00
for the first forty (40) Tanker Loads per month and $320 per Tanker Load in
excess of forty (40) Tanker Loads per month. The purchase price reflects an
actual price for the water of $105.00 per Tanker Load.
3.02 Price Adjustment -- On or after May 1, 1999 and June 1, 1999, the
Seller may notify the Buyer that the Seller has adjusted the sales price for the
Water and such adjusted sales price shall be effective per gallon of Water sold
to the Buyer during the next Three Year Period.
3.03 Payment -- The Seller shall invoice the Buyer monthly in arrears
for all amounts due from the prior month for all orders of the Water shipped by
the Seller to the Buyer pursuant to
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the terms of this Agreement or for any deficiency in the Minimum Order. Payment
of all invoices shall be net thirty (30) days.
3.04 Delivery -- The terms of delivery of the Water shall be F.O.B.
000 Xxxxx Xxxx Xxxxxx, Xxxx Xxxxxx, Xxx Xxxxxx. Title to and risk of loss of the
Water shall pass to the Buyer upon Seller delivering to the Buyer the Water, as
provided for herein.
SECTION 4. Specifications; Limitation of Warranties; Claims
4.01 Specifications -- The Seller represents and warrants that the
Water is natural spring water pumped in accordance with all applicable state and
federal regulations as well as applicable NSF and IBWA bulk spring water
standards.
Except as herein expressly stated, the Seller does not warrant the
goods covered by this Agreement in any manner whatsoever, and no warranty,
express, implied or statutory, is made by the Seller as herein set forth. The
Buyer agrees that it has not relied upon the Seller's skill or judgment to
select or furnish goods for any particular purpose, and this sale is made
without any warranty by the Seller that goods are suitable for any particular
purpose. The remedies provided in this contract for breach thereof by the Buyer
or the Seller shall constitute the exclusive remedies available to the aggrieved
party and all other remedies which might otherwise be available under the law of
any jurisdiction are hereby waived by both the Seller and the Buyer.
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4.02 Good Title -- The Seller further warrants the Water shall be
delivered free from any lawful security interest lien or other encumbrance, and
the Seller shall convey good title thereto.
4.03 Disclaimer -- THE SELLER MAKES NO INDEMNITY, REPRESENTATION OR
WARRANTY, EITHER EXPRESSED OR IMPLIED, WITH RESPECT TO THE WATER, EXCEPT FOR THE
WARRANTIES AND INDEMNITIES EXPRESSLY SET FORTH IN THIS SECTION 4, AND IN NO
EVENT SHALL THE SELLER BE LIABLE TO BUYER FOR SPECIAL OR CONSEQUENTIAL DAMAGES
BEYOND THOSE DAMAGES EXPRESSLY PROVIDED HEREIN.
SECTION 5. Term - Termination
5.01 Term -- The term of this Agreement shall be for forty-three (43)
years commencing July 1, 1996 and ending June 30, 2039, unless this Agreement is
earlier terminated in accordance with its Section 5.02.
5.02 Termination -- This Agreement may be terminated:
(i) BY EITHER PARTY HERETO:
A. In the event of the breach or default by the other party of the
terms and conditions hereof; provided however, that the terminating party shall
first give to the defaulting party prompt written notice of the proposed
termination of this Agreement, specifying the grounds therefor, and the
defaulting party has failed to cure such default within sixty (60) days after
receiving such written notice; or
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B. Upon at least ninety (90) days' prior written notice if the
defaulting party is unable to fully perform its obligations under this Agreement
for any consecutive sixty (60) day period as a result of any contingency, delay,
failure or cause set forth in Section 8.01; or
C. The failure by the parties to reach mutually agreeable price
adjustment(s) for each succeeding Three Year period of this Agreement by the
expiration of the immediately preceding Three Year Period.
Termination of this Agreement pursuant to this Section 5 shall not
affect any other rights or remedies the terminating party may have under law or
equity.
(ii) BY THE BUYER:
When and in the event Xxxxxx X. Xxxxxx, III no longer owns and
controls at least fifty-one percent (51%) of the outstanding voting common
shares of the capital Seller stock of the Seller.
SECTION 6. Access to the Spring
On reasonable notice (at least three (3) working days), the Buyer may
reasonably inspect the operations of the Spring and may visit the Spring with
others for any valid business purpose of the Buyer (e.g. customers, investors,
advisors, etc.). The Buyer may use photos of the Spring in any advertising.
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SECTION 7. Reports Furnished by Seller
The Seller shall furnish the Buyer with a copy of all reports,
licenses, analysis, permits, inspections, etc., of the Spring conducted by any
State, Federal or local agency or the NSF or IBWA, at least annually.
SECTION 8. Force Majeur
8.01 Causes -- No party shall be held liable or responsible for
failure or delay in fulfilling any obligation of this Agreement which is due, in
whole or in part, directly or indirectly, to any contingency, delay, failure or
cause of any nature beyond the reasonable control of such party, including
without in any way limiting the generality of the foregoing, fire; explosion;
earthquake, storm, flood or other adverse weather conditions; unavailability of
necessary utilities or fuel, damage to or accident involving a breakdown of
machinery or facilities; strike, lockout; activities of a combination of workmen
or labor difficulties (from whatever cause arising, and whether or not the
demands of the employees are reasonable or within such party's power to grant);
insurrection; riot; act of God or the public enemy; law; act; war; proclamation;
decree; regulations; ordinance or insurrection of government or other public
authorities; judgment or decree of a court of competent jurisdiction; delay or
failure of carriers or contractors; labor shortages; the inability to obtain
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transportation, equipment, operating materials, plant equipment or materials
required for maintenance or repairs; or the inability to procure necessary raw
materials; or the inability to obtain or loss or suspension of, necessary
licenses or permits; or any other condition beyond the reasonable control of the
affected party.
8.02 Notice -- Each party shall give to the other party prompt written
notice of the occurrence of any such contingency, delay, failure or cause
described in this Section 8, the nature thereof, and the extent to which the
affected party shall be unable to fully perform its obligations hereunder. Each
party shall use all reasonable efforts to correct the contingency, delay,
failure or cause as quickly as possible, and to give the other party hereto
prompt written notice when it is again fully able to perform in accordance with
this Agreement.
8.03 Replacement Orders -- All quantities of the Water not shipped by
the Seller hereunder due to any contingency, delay, failure or cause described
in this Section 5 shall be confirmed, in writing, by the parties immediately
after such contingency, delay, failure or cause has been corrected. During the
continuance of such contingency, delay, failure or cause, the Buyer shall be
free to purchase elsewhere the quantities of the Water the Buyer has ordered and
which the Seller is unable to deliver.
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SECTION 9. Independent Contractors
Each party shall be deemed to be an independent contractor and not the
agent, employee, partner, joint venture of the like of the other party, and
neither party shall have the authority, either express or implied, to make any
statement, representation or commitment of any kind or take any action which
shall bind the other party, except as specifically provided herein or authorized
in writing by a designated representative of the party to be bound.
SECTION 10. Insurance
The Seller agrees to maintain general and comprehensive liability
insurance in an amount not less than One Million Dollars ($1,000,000) and to
name, where appropriate, the Buyer as an additional named insured. Seller shall
additionally require any trucker or transporter engaged to deliver the Water to
maintain general and comprehensive liability and motor vehicle transporter
insurance (all risk) in an amount not less than One Million Dollars ($1,000,000)
and to name Buyer and seller, where appropriate, as additional named insureds.
SECTION 11. Assignment
Neither party hereto shall assign this Agreement without the written
consent of the other party.
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SECTION 12. Continuing Obligations
Termination or expiration of this Agreement shall not relieve either
party from full performance of any obligations incurred prior thereto.
SECTION 13. Waiver
The terms of this Agreement may be waived only by a written instrument
executed by the party waiving compliance. The failure of any party at any time
to require performance of any provisions hereof shall, in no manner, affect the
right at a later date to enforce the same. No waiver by any party of any
condition, or breach of any provision, term, covenant, representation or
warranty contained in this Agreement, whether by conduct or otherwise in any one
or more instances, shall be deemed to be or construed as a further or continuing
waiver of any such condition or the breach of any other provision, term,
covenant, representation or warranty of this Agreement.
SECTION 14. Severability
If any provision of this Agreement shall be invalid or unenforceable
to any extent, the remainder of this Agreement shall not be affected thereby and
shall remain valid and enforceable to the greatest extend permitted by law.
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SECTION 15. Captions
The Captions in this Agreement are for convenience only and shall not
affect the construction or interpretation of any term or provision hereof.
SECTION 16. Notices
All notices required to be given under the terms of this Agreement or
which any of the parties desires to give hereunder shall be in writing and
delivered personally or sent by registered or certified mail, postage prepaid,
return receipt requested, or sent by telegram, telex, telecopies or similar
electronic media (confirmed by registered or certified mail) to the addresses
set forth in the introduction of this Agreement or to such other address and to
the attention of such other person as the party to whom such notice is to be
given may have theretofore designated by notice to the other party hereto. Any
notice given in accordance with the foregoing shall be deemed to have been given
when delivered in person or received by telegram, telex, telecopier or similar
electronic media or, if mailed, on the fifth (5th) business day following the
postmark date which it bears.
SECTION 17. Completeness of Agreement
This Agreement and any Exhibits hereto represent the entire contract
between the parties with respect to the subject
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matter hereof superseding all prior agreements with respect thereto, and the
same shall not be modified or affected by any offer, proposal, statement or
representation, oral or written, made by or for any party in connection with the
negotiation of the terms hereof. The terms and conditions contained in any
documents utilized by either party in connection with ordering, acknowledging an
order, shipment or receipt of any product, including, without limitation, any
acknowledgment or acceptance of purchase order or shipping instruction forms at
variance with or in addition to those set forth herein, shall be of no force and
effect with respect to the transactions contemplated under this Agreement.
SECTION 18. Amendment
This Agreement shall not be amended or modified except by an
instrument in writing signed by each of the parties hereto.
SECTION 19. Governing Law
The validity, interpretation and performance of this Agreement shall
be governed and construed in accordance with the laws of the state of New
Jersey.
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SECTION 20. Binding Effect
This Agreement shall be binding upon and shall inure to the benefit of
the Seller and the Buyer and their respective successors, assigns, grantees and
legal representatives.
SECTION 21. Counterparts
This Agreement may be executed in two or more counterparts, each of
which need not contain the signatures of more than one party, but such
counterparts taken together shall constitute one and the same Agreement.
In WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be executed by their respective, duly authorized representatives, as of the
day and year first above written.
ATTEST: MOUNTAINWOOD SPRING WATER
CO., INC
/s/ [ILLEGIBLE] By: /s/ X. X. Xxxxxx, III
-------------------------- ------------------------------------
a duly authorized officer
ATTEST: PURO WATER GROUP, INC.
/s/ [ILLEGIBLE] By: /s/ Xxxx X. Xxxx
-------------------------- ------------------------------------
a duly authorized officer
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